With politics and economics seemingly working against employer efforts to increase diversity, equity, and inclusion (DEI) in the workforce, many DEI proponents are worried about the future. And a recent report from a global consulting firm shows reasons for concern.
Changing Attitudes and Priorities
In April, DDI released its 2023 Diversity, Equity, and Inclusion Report, which claims many employers are regressing in their DEI efforts. The report found an 18% decrease in leaders’ endorsement of their company’s overall DEI efforts in the last two years.
The research also found a 33% increase in the number of companies that don’t have a DEI program in place.
“With the stress of economic uncertainty and labor challenges, companies have turned their attention away from DEI toward these urgent issues, but that has left many leaders, especially those who are women and from minority racial and ethnic backgrounds, questioning their company and role,” Stephanie Neal, director of DDI’s Center for Analytics and Behavioral Research, said.
“If companies don’t act now to rekindle and reinvest in their DEI programs, the loss of talent will have a profound impact on future business success,” she added.
It’s not just economic stress influencing DEI efforts. Political pressures also come into play. For example, Florida’s Stop WOKE Act, which took effect in July 2022, means employers in the state must carefully examine their diversity training programs.
The law prohibits employers with 15 or more employees from requiring them to participate in any form of training that “espouses, promotes, advances, inculcates, or compels” individuals to believe any of the concepts spelled out in the law.
Those concepts include that an individual’s moral character or status is either privileged or oppressed because of race, color, sex, or national origin and that an individual should feel discomfort, guilt, anguish, or any other form of psychological distress because of race, color, sex, or national origin.
The DDI report’s introduction notes the pandemic and economic uncertainty are resulting in a “serious backslide on DEI progress,” endangering business success.
“Across the board, women and minority leaders are ready to leave their companies at significantly higher rates than men and non-minority peers,” adding the researchers found little connection between the intent to leave and opportunity for advancement. “Instead, we discovered a strong association between intent to leave and a lack of trust in their organization.”
The report also notes companies have made progress with ethnic and racial diversity since DDI’s previous report in 2020, and one of the key drivers of increased diversity is the development of high-potential candidate pools.
“However, high-potential pools still tend to have lower representation of women and minorities than their general leadership population,” the report says.
The DDI report says DEI investments reap strong results, “both financially and as they reduce risk in their leadership pipeline.” The report advises integrating DEI into how your organization operates rather than as a separate initiative.
The research identified five key practices to help companies make their DEI efforts successful:
- Make DEI a clear priority. Support from the top is essential and must be accompanied by sound practices that integrate inclusion into day-to-day operations and talent management systems.
- Leaders need to have strong interpersonal skills, including empathy. Diverse talent is likely to leave if leaders don’t make them feel like they belong, are valued, and have a future at the company.
- Succession planning plays a role. Employers need to proactively recruit high-potential talent from diverse backgrounds.
- Senior leaders must build trust. Leaders must follow through on promises, practice transparency, and build trust as part of the way they do business, not just in relation to DEI matters.
- Coaching for growth is crucial. Managers need to provide opportunities for team members to grow and develop. Many organizations mistakenly put people in roles they aren’t prepared for, but organizations that succeed make a conscious effort to develop coaching capabilities so people get the feedback and coaching they need to take on new opportunities.
Tammy Binford is a Contributing Editor at HR Daily Advisor.